A supply chain is a network of retailers, distributors, transporters, warehouses, and suppliers that take part in the production, delivery, and sale of a product or service. Supply chain management is the process of coordinating the movement of the products or services, information related to the products or services, and money among the constituent parts of a supply chain. Supply chain management also integrates and manages key processes along the supply chain. Supply chain management strategies often involve the use of software to project and fulfill demand and improve production levels.
Logistics is a sub-set of the activities involved in supply chain management. Logistics includes the planning, implementation, and control of the movement and storage of goods, services or related information. Logistics aims to create an effective and efficient flow and storage of goods, services, and related information from a source to the target location where the product or source is to be shipped to meet the demands of a customer.
The movement of goods and services through a supply chain often involves the shipment of the goods and services between the source location at which the product is produced or stored and the target location where the product is to be shipped to the wholesaler, vendor, or retailer. The shipment of products involves a transport such as a truck, ship, or airplane and involves the planning and the arrangement of the products to be shipped in the transport. The source location from which a set of products is shipped on a transport is selected based on the availability of the products at the source location.
After a product has been discontinued or is otherwise not actively produced, it is generally necessary to maintain replacement parts for a period of time after production has stopped. These replacement parts are stored at different locations and in different quantities. Unfortunately, traditional forecasting models fail to accurately forecast the need for these replacement parts.